Inside sales are when a salesperson sells the company’s products and services in the office. The salesperson does not need to travel to the field in search of prospective buyers but only reach out to them through emails, a phone call or through social media platforms. The salespersons are expected to make buyers aware of the products and services, convince them to buy, explain the features and uses of the products, transacting and following up the buyer to ensure 100% satisfaction and buyer retention.
Inside sales make commission in most organizations so as to encourage the sales representatives to generate more sales. The inside salespersons need to collaborate with other employees to be able to make the sale process more efficient. In such an instance it is only reasonable to compensate commissions to all personnel involved in the process. If you want professional salespersons you can hire real estate ISA companies for higher output.
Types of sales commission
- Revenue commission-it is when a salesperson is paid commission on a certain percentage of the sales made. For instance, if the salesperson made 10,000 sales they are paid 5% of the amount on top of their basic salary.
- Placement commission-this commission received on a certain amount of sales. For instance, the salesperson can receive $10 for every item sold.
- Gross profit commission-this is commission earned as a percentage of the gross profit earned. For instance, if the buying price of a product is $30 and you sold for $50 and the gross profit percentage is 5, the gross profit is $20 and you will receive 5% of $20.
- Revenues gates commission-it is earned depending on your performance, discipline, punctuality and the positive effect on your sales output. The management will decide on the amount you will receive.
An inside salesperson in most cases collaborates with other personnel to generate more sales. They can work closely with the outside salesperson to ensure that they retain buyers and build a trustworthy relationship with them. In such instances the commission gathered from the sales or gross profit made will be shared equally.
However, some organizations dismiss the importance of giving their inside salespersons commission and instead offer them a fixed basic salary just like any other employee. In such a business environment the salesperson is not motivated to do more than the extraordinary since their extra efforts and extra working hours goes unnoticed.
Although sales commissions encourage salespersons to be more productive it may force them to exploit the sales process to gather more output. The salespersons may mislead buyers in an attempt to make quick sales or not sell the products and services at the agreed price.
The compensation of an inside sales representative includes a basic salary and a sales commission. A basic salary is given as the salesperson is expected to perform other duties other than sales such as buyer’s data entry, creating a contact list and conducting after sales follow up. On the other hand, the commission is given when the salesperson reaches a certain target. Sales commissions are given to motivate the inside salesperson to make more sales and give the company more output.